CALGARY, May 8, 2013 /CNW/ –Surge Energy Inc. (“Surge” or the “Company”) (TSX:SGY.TO) is pleased to announce certain senior management changes, effective immediately, a private placement of up to $2.5 million, and the sale of certain non-core, non-operated assets for proceeds of approximately US$42.75 million.

MANAGEMENT CHANGES:

The Board of Directors of Surge (“Board”) is pleased to announce that they have unanimously agreed to appoint Mr. Paul Colborne as the President and CEO of Surge, effective immediately. Mr. Colborne will also continue on as the Chairman of the Company.

In addition, Surge is pleased to announce the addition of Mr. Murray Bye as the Vice President of Production of Surge. Mr. Bye will assume his new role immediately.

The Board also announced today that Mr. Dan O’Neil will be retiring from his role as CEO and President of the Company. The Company thanks Mr. O’Neil for his efforts and service on behalf of Surge shareholders. Mr. O’Neil will continue as a director of the Company and will provide technical assistance.

“My time at Surge has been extremely rewarding and I am very proud of the asset base and team we have built since recapitalizing the Company in 2010,” said Mr. O’Neil. “Surge shareholders will be well served with Mr. Colborne as President and CEO with his extensive experience leading high performing teams and building successful companies in the Western Canadian Sedimentary Basin.”

“I am very excited about this opportunity,” said Mr. Colborne. “Surge has high quality, large internally estimated DPIIP1 reservoirs, with low recovery factors to date, and is strategically focused in just three key operating areas. These high quality, operated light and medium gravity crude oil assets have significant, low risk upside with numerous infill and step-out drilling locations and waterflood opportunities.

This rare, deep value opportunity is illustrated by the fact that Surge’s year-end net asset value exceeded $8.21 per basic share2, which is significantly higher than the current trading price of the Company’s shares. I look forward to working with the Company’s proven management team to continue growing Surge as it transitions into an elite, intermediate oil and gas company.”

PROVEN TRACK RECORD:

Mr. Colborne has over 22 years of experience in the oil and gas industry and has been involved in a leadership, executive or director capacity with over 30 oil and gas and energy services companies.

Discovered Petroleum Initially In Place (DPIIP) is defined as quantity of hydrocarbons that are estimated to be in place within a known accumulation, plus those estimated quantities in accumulations yet to be discovered. There is no certainty that it will be commercially viable to produce any portion of the resources. A recovery project cannot be defined for this volume of DPIIP at this time, and as such it cannot be further sub-categorized.

2

Calculated using net present value discounted at ten percent before tax as at December 31, 2012 for Surge evaluated by Sproule using forecast pricing and costs.

Startech: President & CEO from 1993 to 2001

Grew production to 16,000 boe per day from 120 boe per day at start-up

Sold to ARC Energy Trust for $500 million

Crescent Point: Chairman, President & CEO from June 2001 to September 2003

In accordance with his appointment as President and CEO, Mr. Colborne will be subscribing for up to $2.5 million of Surge Units. (“Units”) at a price per Unit representing the maximum allowable discount to the market price of the common shares of Surge (“Common Shares”) permitted by the rules of the Toronto Stock Exchange (the “Issue Price”). Each Unit shall be comprised of one Common Share and two Common Share purchase warrants (“Warrants”). Each Warrant shall entitle the holder to purchase one Common Share at a 25% premium to the issue price of the Units for a period of 5 years. The Warrants shall be subject to time based and performance based vesting requirement such that the Warrants will only vest and become exercisable on the basis of one half upon the 20-day weighted average trading price of the Common Shares (“Trading Price”) equaling or exceeding a 50% premium to the market price of the Common Shares used to determine the Issue Price (undiscounted) (the “Reference Price”) and an additional one half upon the Trading Price equaling or exceeding a 100% premium to the Reference Price. The private placement is subject to the approval of the Toronto Stock Exchange.

Mr. Colborne will not be taking a salary with respect to his employment as President and CEO of Surge, but shall participate in short-term and long-term incentive plans.

Mr. Bye is a Professional Engineer with more than 13 years of engineering experience including exploitation, production, and reservoir in Western Canada. Mr. Bye has held the role of Asset Team Lead – West at Surge since 2010 where he has been responsible for growing three core operating properties at Valhalla, Nipisi and Windfall. Prior to his role at Surge, Mr. Bye held a number of positions at EnCana Corporation between the years 2000 to 2010 including: Group Lead of Development, Exploitation Engineer, and Production Engineer. Mr. Bye graduated in 2000 from Montana Tech with a Petroleum Engineering degree. Surge welcomes Mr. Bye in his new role as Vice President Production at the Company.

STRATEGIC RATIONALE FOR CHANGES:

Realizing Shareholder Value:

In just three years, Surge management has built a high quality, high netback, reserve, production and cash flow base focused primarily in three elite, operated, crude oil properties. Approximately 90 percent of Surge’s assets are focused in these three assets.

Surge management has delivered excellent per share growth in reserves, production and cash flow each year of the Company’s existence on a cost effective basis. Surge’s 2012 year-end independent engineering report (effective December 31, 2012) provides an estimated net asset value of $8.21per basic share for its Proved plus Probable (“P+P”) reserves.

Surge realized 2012 Finding Development and Acquisition (“FD&A”) costs, including the change in future development capital, of $23.32 per P+P reserves for a recycle ratio of 1.5 times. The team delivered an increase in P+P reserves of 43 percent and 29 percent on a fully diluted per share basis. Surge also achieved a P+P reserves replacement ratio of 5.3.

In the first quarter of 2013, Surge management delivered one of the best quarterly drilling programs in the Company’s history (please refer to Surge’s press release dated March 20, 2013), with highlights that include:

a) A significant new light oil pool discovery on the southern portion of Company’s core property at Nipisi in Western Alberta (internally estimated DPIIP of approximately 30 million barrels in the Slave Point light oil formation) with numerous follow-up locations;

b) An exciting, light oil northern pool extension at the Company’s core property at Valhalla in Western Alberta (confirming the internally estimated DPIIP in the Doig light oil pool of more than 150 million barrels) with numerous follow-up locations;

c) A large medium gravity crude oil new pool discovery at the Company’s core property in the Silver Area in SE Alberta (internally estimated DPIIP of more than 47 million barrels) with up to 20 follow-up locations;

d) An additional new pool discovery in the Silver Area of SE Alberta (internally estimated DPIIP of 2.2 million barrels); and

e) Continued successful development drilling results at Nipisi North (internally estimated DPIIP of 85 million barrels in the Slave Point light oil formation)

In spite of these positive developments, Surge’s share price has underperformed the peer group and currently trades at a significant discount to its net asset value.

Given that Surge has grown dramatically over the last three years, and given that the Company’s true value is not being recognized, Surge’s Board and management believe that changes are necessary to the Company’s business plan and operating strategy to adapt and succeed in the current, challenging business environment.

New Sustainable Business Model:

Surge has assembled a high quality, light and medium gravity crude oil asset base. The Company has approximately 90 percent of its assets located in three key producing assets in the Valhalla, Nipisi and Silver areas of Alberta. These core operated assets are characterized by large DPIIP reservoirs with low recovery factors to date, and significant upside from infill and step-out development drilling and successful water flood implementation.

However, as the Company’s production has now exceeded 10,000 boe per day (greater than 70 percent oil and NGLs), like most of its peers Surge’s rate of annual per share growth is slowing from more than 20-25 percent to approximately 10-12 percent.

Given the current business environment, Surge’s high netback crude oil asset base, and the Company’s large inventory of low-risk development drilling locations and waterflood projects, the Board and management of Surge have determined that a number of changes are necessary with the respect to the Company’s business plan.

Aggressively manage the Company’s cash costs and its general and administrative costs per boe.

In addition to the above operating principles, Surge will also consider minor, non-core asset sales, such as the successful sale of Surge’s non-core, primarily non-operated North Dakota assets (see below), to reduce debt where applicable and potentially to fund normal course issuer bids to acquire and redeem the Company’s common shares in the market at price levels below its net asset value.

In this regard, Surge Board and management will also be considering a strategic conversion to a moderate growth / dividend business model.

NON-CORE ASSET SALE:

Surge has executed a formal purchase and sale agreement with a Canadian oil and gas producer to sell its non-core, primarily non-operated assets in North Dakota for a purchase price of approximately US$42.75 million. Closing of this transaction is anticipated to occur on or aroundMay 31, 2013. The non-core assets being sold comprise production of approximately 650 barrels of oil per day, with independently engineered P+P reserves of 2.2 million boe, and a net present value of $36.8 million (discounted at ten percent before tax as of December 31, 2012). The Company expects a reduction in its borrowing base of $13 million as a result of the sale, resulting in a bank line of $277 million.

The sale of Surge’s assets in North Dakota is the first step in implementing changes in the Company’s business plan to maximize shareholder value, strengthen the Company’s financial flexibility and support a sustainable business model.

FINANCIAL ADVISORS:

Macquarie Capital Markets Canada Ltd. is acting as lead financial advisor to Surge with respect to the above. National Bank Financial Inc. is acting as financial advisor to Surge.

ANNUAL GENERAL MEETING:

Surge’s Annual General Meeting is scheduled for 12:30 pm Mountain Standard Time on May 15, 2013 at the Petroleum Club, Devonian Room located at 319 – 5th Avenue SW, Calgary AB.

Surge is an oil focused oil and gas company with operations in Western Alberta and Manitoba. Surge’s common shares trade on the Toronto Stock Exchange under the symbol SGY and the Company currently has 71.2 million basic and 79.4 million fully diluted shares outstanding.

The forward-looking statements are based on certain key expectations and assumptions made by Surge, including expectations and assumptions concerning the performance of existing wells and success obtained in drilling new wells, anticipated expenses, cash flow and capital expenditures and the application of regulatory and royalty regimes.

Although Surge believes that the expectations and assumptions on which the forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because Surge can give no assurance that they will prove to be correct. Since forward-looking statements address future events and conditions, by their very nature they involve inherent risks and uncertainties. Actual results could differ materially from those currently anticipated due to a number of factors and risks. These include, but are not limited to, risks associated with the oil and gas industry in general (e.g., operational risks in development, exploration and production; delays or changes in plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of estimates and projections relating to production, costs and expenses, and health, safety and environmental risks), commodity price and exchange rate fluctuations and uncertainties resulting from potential delays or changes in plans with respect to exploration or development projects or capital expenditures. Certain of these risks are set out in more detail in Surge’s Annual Information Form which has been filed on SEDAR and can be accessed at www.sedar.com.

The forward-looking statements contained in this press release are made as of the date hereof and Surge undertakes no obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.

Note: Boe means barrel of oil equivalent on the basis of 1 boe to 6,000 cubic feet of natural gas. Boe may be misleading, particularly if used in isolation. A boe conversion ratio of 1 boe for 6,000 cubic feet of natural gas is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Boe/d means barrel of oil equivalent per day.

Neither the TSX nor its Regulation Services Provider (as that term is defined in the policies of the TSX) accepts responsibility for the adequacy or accuracy of this release.